Article | 4 min read

Power move: CX strategies for energy and utility companies

How energy and utility companies in the UK can keep their customers’ temperature down when energy prices are going up.

By Sarah Lewis, Director, Regional Marketing, EMEA West

Last updated September 22, 2022

This winter will mark the third year of COVID-19 pandemic. Along with the human toll of the crisis, the British public has endured rising prices for goods and services—and the coming cold weather will place yet another burden on the budgets of weary Britons.

Since the start of 2021, the cost of living has increased across the UK, with inflation at its highest since 1982. Household energy tariffs are increasing and petrol costs are skyrocketing. From July 2021 to July 2022, gas prices in the UK increased by 96 per cent, while electricity prices went up by 54 per cent.

To provide the public with some relief, the government announced £350 in support for every household in the UK earlier this year. But it may not be enough. Philippe Commaret, a senior executive with EDF Energy UK, warned that the UK was facing a “catastrophic winter” and that half of all households could fall into fuel poverty–when a household spends more than 10 per cent of its income on energy costs—without intervention.

Ridiculous and ludicrous

Even Michelin-starred chefs are not immune from rising fuel costs. Tom Kerridge, who owns the Hand and Flowers pub in Marlow, has been venting his frustration with rising fuel prices on Twitter. Kerridge has been retweeting fellow Britons’ energy woes after he discovered that one of his smaller restaurants is facing a “ridiculous and ludicrous” 600 per cent increase on its energy costs this winter.

“We’re on a tight contract that comes to an end in December—and it goes from £5,000 a month to £35,000,” Kerridge told an incredulous Nihal Arthanayake on Radio 5 Live. “Obviously, we’re going to shop around and most definitely try and bring that down.”

The CX challenge

Kerridge is not the only one looking for a new energy supplier. A study performed by Echo Managed Services found that 34% of consumers in the UK regularly switch utility providers. The study also found that there are four main reasons customers switch utility companies:

  • 61% of customers leave because of price increases
  • 40% of customers leave because they want to find a better deal
  • 36% of customers leave because of tight household budgets
  • 33% if customers leave because of poor customer service

While there’s not much that utility providers can do about rising energy costs—there’s always room to improve the customer experience. Interact with your customers where they are—through mobile apps, text messages, and phone calls with live agents.

Omnichannel is everything

EY, one of the world’s top accounting firms, recently conducted a survey of 34,000 energy consumers across 17 countries to better understand the current CX landscape for energy providers.
According to EY’s survey, energy consumers prefer to engage digitally 80 per cent of the time. But when it comes to making a complaint, managing an outage or emergency, or resolving other issues—consumers still prefer to speak with a live support agent.

“Consumers have created a new interaction paradigm that can be summed up as ‘technology when you want it, a person when you don’t’,” EY Global Power & Utilities Customer Experience Transformation Leader, Greg Guthridge, said. “So, while digital enablement is clearly a critical focus area for energy providers, the seamless integration with human interaction is also part of the future engagement mix.”

What customers really want

Understanding what your customers actually care about is the key to improving CX. According to Bain & Company, utility executives excell at large capital projects, like building power plants and managing a complex power grid—but have lagged in developing a customer-centric organisation.

In 2020, the average Net Promoter Score® across the energy sector for all British suppliers was -6, meaning more people were unhappy with their supplier versus those who were happy. Bain recommends that in order to improve the customer experience, utility companies should focus on earning customer loyalty, following the models established by Addias, IKEA, Lego, and others.
One strategy cited by Bain that has been proven to improve customer experience—and increase revenue—is to give customers a choice in how they pay their bills. When utility companies allow customers to choose their own due dates, offer payments in instalments, and flat-rate billing, it results in improved costs, increased revenue, fewer write-offs and increased customer satisfaction.

Weathering the storm

Despite an onslaught of challenges, energy and utility companies have an opportunity to support customers in innovative ways. By providing multiple channels to engage with customers, electric, gas, power, and water companies can help take the chill off of this coming winter.

Zendesk can help you navigate these CX challenges. Find out how you can transform your relationships with customers with the future of customer experience.